One Small Loan Can Make a World of Difference

“After ChildFund gave our family the loan, everyone is much happier,” 9-year-old Ghopika explains.

Ghopika (r) and her family.

Before 2009, her family was in a state of paralysis, both physically and economically. Both parents suffered from polio as children, and have debilitating foot disorders. These disabilities prevent them from securing agricultural or heavy labor jobs, common sources of income in Batticaloa, Sri Lanka.

Ghopika’s father was able to do some fishing with a borrowed boat, but the family was constantly living hand-to‐mouth. This left no spare income to support the three school-aged children in the family.

In Batticaloa, ChildFund has just finished its KOHA project, sponsored by ChildFund New Zealand, which offers low-interest loans to families interested in starting new businesses. Among the criteria required of KOHA loan recipients are that the families are low income and have children who are attending school.

To monitor and evaluate new loans, ChildFund has trained Child Well-Being Committees (CWBCs), staffed by community members, who are now carrying forward the work of KOHA. The overall goal is not only to provide families with a new source of reliable income but also ensure that this income will be used to benefit the education of children in the community.

Additionally, money gained from interest on the loan is partially reused to provide additional community support. Ghopika’s father used his particular loan of 14,000 rupees (US$140) to expand and improve his fishing business. He bought a secondhand canoe and a set of new fishing nets. Now he can bring in about 2 to 3 kilos (5 pounds) of fish per day, earning from 4,000 to 5,000 rupees (US$95) per month.

As for Ghopika, she now has the essentials she needs to succeed at school. Before, her family could not afford school books, materials or transportation to school. She also attends school regularly and is happy to go because she has ambitions of becoming a doctor. “One day it is my dream to heal my parents” she says.

Because Ghopika’s family has completely repaid their first loan, they are eligible to take on a second. With the additional funds, Ghopika’s father plans to invest in a bicycle with an attached carrying box. This will give him access to the markets in Batticaloa town, some 20 kilometers (about 13 miles) away. There, he can fetch much higher prices for his fish than he otherwise could in the local village.